Why donors give during emergencies—An institutional analysis on government transparency

Abstract

AbstractThis study employs an institutional approach to examine and explain donor‐giving to a government during emergencies. Using data from 120 countries during Covid‐19 and other sources, we tested a process transparency explanation against a performance transparency perspective. We find that a donor's decision to give to a government during emergencies is likely influenced by the availability and quality of process‐oriented fiscal information, not past performance or impact information of the government. This result indicates that it is important for governments, especially those without proper transparency institutions and practice, to establish reporting measures in process‐oriented information such as revenue sources, spending directions, and debt levels during emergencies. These insights have significant theoretical and policy implications for countries, especially developing countries, to develop government transparency.